Mortgage foreclosures harm children and families

Moving from place to place because of foreclosure, and homelessness, causes education gaps for children, as well as behavioral problems.

A report released on April 18 by First Focus, an advocacy organization affiliated with The Brookings Institution, estimates that 8 million US children will be directly impacted by ongoing the mortgage crisis. The report, “The Ongoing Impact of Foreclosures on Children,” is the second released by First Focus on the foreclosure crisis’ impact on children and families. According to the group, of the 8 million children affected, 2.3 million have already lost their homes. Three million more children are at serious risk of losing their homes in the near future, and an additional 3 million have been evicted, or may face eviction, from rental properties that undergo foreclosures. This report is the first to quantify the children in rental units affected by foreclosure.

“Children are the often invisible victims of the foreclosure crisis,” said report author Julia Isaacs of the Brookings Institution. “Foreclosure affects not just the homeowner or landlord, but also the children living in the foreclosed properties.” Isaacs conducted the study while at the Brookings Institution and is now a senior fellow at the Urban Institute's Labor, Human Services and Population Center. She looked at foreclosure and U.S. Census Bureau data in calculating the number of children affected. The report is the second released by First Focus on the crisis' impact on children, and it is the first to estimate the number of children affected who live in rental properties.

The report indicates that foreclosures often harm a child’s health and education. Families whose homes are in foreclosure are more likely than others to move, a fact that can have a negative effect on academic achievement. The report said, “These families are also under financial and psychological stress, which affects the way parents interact with their children, sometimes leading to harsher and less supportive parenting. Additionally, foreclosures and housing instability is shown to have a negative impact on physical and mental health.”

“Housing disruptions due to foreclosure are just as traumatic for kids as losing their homes to a tornado or hurricane— except this disaster will hit one in ten children. Being forced from home affects children’s health, interrupts development, and hurts their chances of success in school,” said First Focus president Bruce Lesley. The First Focus report analyzed foreclosures in all 50 states, and the District of Columbia. n Alaska and North Dakota showed the lowest rates in the country, with only 2 percent of children affected. Nevada, where Las Vegas was seriously hit with foreclosures and empty houses, is in the lead with children affected by foreclosure at 19 percent. Other states above the national average include: Florida (15 percent), Arizona (14 percent), California (12 percent), Michigan (10 percent), Illinois (9 percent), Maryland (9 percent), Rhode Island (9 percent), Colorado (8 percent), and Georgia (8 percent).

The report details specifically the effects of mid-year school disruptions. It found that for every forced move, a child’s reading and math scores dropped by as much as if he or she had missed a month of school. Teachers in public schools, which have seen an uptick in the number of students in some areas, are hard hit since they must contend with children whose lessons have been truncated by family moves.

Studies conducted by the General Accounting Office and nonprofits in the past show that foreclosures and frequent moves lead to deficiencies in mathematics and reading, health problems associated with losing health insurance, as well as behavioral and socialization problems associated with anxiety and shame. Children who are frequent movers were 77% more likely than those who have not moved to display several behavioral problems, according to a 1994 General Accounting Office report. A 2007 study by the Center for Housing Policy in Washington DC found that working families that spend more than half their income on housing have less money available than other families to pay for health care and other crucial needs.

Children who are forced to move leave behind their neighborhoods and school districts, thus affecting their academic progress. For example, third-graders who have changed schools frequently are more likely to repeat a grade than their peers are, according to a Government Accountability Office report.

The foreclosure means a burden for schools. According to an earlier report by the National Association for the Education of Homeless Children and Youth, and First Focus, more than 300 school districts in the USA have reported a rise in homeless children because of the foreclosure crisis. Areas absorbing the biggest student surges include: California, Florida, Illinois, Michigan, and Texas. Cleveland schools, for example, saw an uptick of more than 2,100 homeless students in 2011, a 30% increase from the previous year.

Bruce Lesley of First Focus envisions a greater role for government in ameliorating the effects of foreclosure, and moving, on children. “The good news is government can reduce the magnitude of this disaster. We can limit the damage by helping families at risk stay in their homes, accelerate recovery by helping foreclosure victims find new homes they can afford, and reduce the trauma for kids by ensuring that losing a home doesn’t mean losing other necessities like health care and a stable education,” said Lesley.
 

The views and opinions expressed herein are those of the author only, not of Spero News.
Filed under finance, mortgage, family, psychology, education, children, business, banking, economics, Society and Culture

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